Summary |
This work provides broad contours – including historical evolution – of fiscal relations between the central and state governments in India. It explains operational aspects of fiscal federalism in India.
More importantly, it empirically examines the effect of federal transfers on tax efforts of 14 major Indian states, viz. Andhra Pradesh, Bihar, Gujarat, Haryana, Karnataka, Kerala, Madhya Pradesh, Maharashtra, Orissa, Punjab, Rajasthan, Tamil Nadu, Uttar Pradesh and west Bengal. The analysis has been done in the context of the use of tax effort as a criterion for inter-se distribution of state’ share of central revenues by various finance commissions.
The book provides an in-depth understanding of the two vital concepts tax effort and tax capacity and the alternative quantitative techniques that can be employed to estimate them.
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